Efficient government size: France in the 20 th century

François Facchini (1, 2) , Mickaël Melki (1)

1 CES - Centre d'économie de la Sorbonne
2 UP11 - Université Paris-Sud - Paris 11

The benefits and costs of government suggest an efficient government size. We investigate efficient government size by analyzing the relation between public spending and real GDP for France in the period 1896–2008. The results show a co-integration nonlinear relationship. Our time-series data on France represents one of the longest periods studied in literature. Our empirical findings suggest that efficient government size measured by public spending was reached when public spending was around 30% of GDP. Conclusions point to particularities of countries that suggest efficient government size is specific to different countries.

Mots clés: Economic growth; Optimal government size; Nonlinear cointegration; Public spending

Mots clés: Croissance économique; Dépenses publiques; Courbe de BARS

Domaines: Economies et finances

François Facchini, Mickaël Melki. Efficient government size: France in the 20 th century. European Journal of Political Economy, 2013, 31, pp.1-14. ⟨10.1016/j.ejpoleco.2013.03.002⟩. ⟨hal-01286723⟩